Love it or hate it, we are all negotiators. From the agenda to the meeting outcome, the task distribution to the deal closing, the new house or the old question of who brings out the trash, we negotiate all day every day. Some things are tiny, while others change the course of our whole career or a client’s business opportunity.
Most people I ask say that they often find negotiations uncomfortable. So for the past 10 years, I have created trips and tricks that boost performance and confidence for everyone in every negotiation, and taught them to over 5,000 people around the world.
This newsletter is for everyone who wants bite-sized reminders and practical examples of the small things we can do to increase our negotiation performance every day. Get better results for ourselves, our clients, and our businesses.
Here is my first tip: Set expectations early in a negotiation.
What happens early in a negotiation matters. The chance to make a first offer or set the framework or conditions is powerful. Much more powerful than most people realize.
The first set of ideas, asks and thoughts in any conversation can have a disproportionately high influence on the rest of the negotiation.
This is called the “anchoring effect” and proven in studies more often than anyone can count.
The seller opens (and they start high) – the price is higher. The buyer opens (they start low) – the price is lower. The employer makes the first offer (lower) – the salary will be lower. The employee makes the first offer (hopefully higher!) – the salary will be higher. These are the classic findings that get replicated time after time.
Some of the studies are hilarious, showing the utter irony of how even the smartest of brains get anchored by the most random numbers. I love this one where MIT students get influenced in their bidding prices at an auction by their social security numbers (people with high social security numbers paid up to 346% more!!).
We often avoid saying our number or setting out our expectations first for fear that they may be misplaced, too demanding, too little demanding and anything in between.
But research is clear: If you want to make a better deal, come prepared and go first!
How do you usually handle your big and small negotiations? Do you wait for the other side or do you go first?
Keep Negotiating!
Your Negotiation Whisperer
PS: This also works with kids! Have you ever asked them what they want for dessert and they say “5 cookies”? You were prepared to give one but now you are negotiating and are unlikely to get away under 3 – and they are still unhappy because they expected 5! What would have happened if you had offered one scoop of ice cream before they got to ask for a whole Mc Sundae with sauce and sprinkles and wafers? Even if you then gave in to an additional bit of chocolate sprinkle on that scoop they would have felt it was a big win. Anchoring also influences satisfaction!
